G.R. No. L-50871 August 4, 1988
CARLOS VELASCO, IN HIS CAPACITY AS RECEIVER OF THE BUSINESS UNDER THE NAME AND STYLE, “CENTRAL ENGINEERING,” petitioner, vs. HON. AMADO G. INCIONG, NATIONAL LABOR RELATIONS COMMISSION and GEORGE MENDOZA, respondents.

FACTS

Private respondent George Mendoza was an office clerk at Central Engineering Shop, a business under receivership due to a pending ownership dispute. From February 28 to March 5, 1977, Mendoza did not report for work. Consequently, on March 8, 1977, the company, through its receiver Carlos Velasco, filed a report with the Department of Labor charging Mendoza with abandonment of work. In response, on March 23, 1977, Mendoza filed a complaint for illegal dismissal and suspension. The Labor Arbiter later ordered Mendoza’s reinstatement without backwages, a decision Mendoza appealed to the NLRC to claim backwages.
Meanwhile, in the civil case concerning the receivership, the trial court authorized a party to designate a representative to oversee the business operations. Mendoza was appointed to this role. The NLRC subsequently ruled that Mendoza was illegally dismissed and ordered his reinstatement with full backwages. On appeal, the Deputy Minister of Labor, Amado G. Inciong, modified this order, directing the payment of backwages only until December 31, 1977 (when the company ceased operations) and granting separation pay. The company, through its receiver, filed this petition for certiorari, arguing the labor tribunal lacked jurisdiction and that Mendoza was not illegally dismissed.

ISSUE

Whether the National Labor Relations Commission had jurisdiction over the labor case despite the company being under receivership, and whether the finding of illegal dismissal was correct.

RULING

The Supreme Court dismissed the petition, affirming the jurisdiction of the NLRC and the finding of illegal dismissal. On jurisdiction, the Court held that the pendency of a receivership proceeding in a regular court does not divest labor tribunals of their jurisdiction over labor disputes. Labor cases fall under the exclusive expertise of the NLRC, and its assumption of jurisdiction does not interfere with the receiver’s control over the property. The receiver, as the employer, is subject to labor laws.
On the merits, the Court found the illegal dismissal ruling supported by substantial evidence. The company’s act of filing an abandonment report was procedurally flawed, as the applicable rules required a prior application for clearance to dismiss, not a mere report, unless the termination fell under specific exceptions like resignation. Abandonment requires a clear, deliberate, and unjustified refusal to resume employment, which was not proven. The evidence showed Mendoza attempted to return to work on March 7, 1977, but was refused work by the shop manager. His absence from February 28 to March 5 was sufficiently explained by his attendance at court hearings related to the receivership case and did not constitute abandonment. Therefore, the refusal to allow him to work constituted a dismissal without just cause. The Deputy Minister’s award of limited backwages and separation pay, considering the eventual cessation of business operations, was legally sound.